Oppenheimer analysts downgraded AutoZone (NYSE:AZO) from Outperform to Perform and set a price target of $2,600.00. The downgrade is based on a more cautious outlook for auto parts retail as the analysts evaluate shifts within the discretionary sector for 2024. While they acknowledge that the underlying fundamentals for auto parts retail and key players in the industry remain strong, they anticipate that the tailwinds driven by the pandemic will continue to diminish.
This could potentially limit the potential for sales and earnings per share (EPS) growth for AutoZone and result in reduced investor interest. The analysts suggest that the current Street forecasts for AutoZone seem reasonable, but they are less optimistic about the potential for their stock multiples to increase significantly from current levels.